false 0000094049 0000094049 2021-06-10 2021-06-10

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): 6/10/2021

 

STEPAN COMPANY

(Exact name of registrant as specified in its charter)

 

Commission File Number: 1-4462

 

Delaware

 

36-1823834

(State or other jurisdiction of incorporation)

 

(IRS Employer Identification No.)

22 West Frontage Road, Northfield, Illinois 60093

(Address of principal executive offices, including zip code)

(847) 446-7500

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of Each exchange on which registered

Common Stock, $1 par value

SCL

New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

 

 

 


 

 

Item 1.01.Entry into a Material Definitive Agreement.

 

On June 10, 2021, Stepan Company (“Stepan”) entered into:

 

 

i.

a Note Purchase and Private Shelf Agreement by and among Stepan, PGIM, Inc., the Purchasers named in the Purchaser Schedule attached thereto (the “Initial Prudential Purchasers”) and each other Prudential Affiliate (as defined therein) from time to time party thereto (the “Prudential Note Purchase Agreement”), pursuant to which, on June 10, 2021, Stepan issued and sold to the Initial Prudential Purchasers $50 million in aggregate principal amount of its 2.30% Senior Notes, Series 2021-A, due June 10, 2028 (the “Series 2021-A Notes”), and

 

 

ii.

a Note Purchase and Master Note Agreement by and among Stepan, NYL Investors LLC, the Purchasers named in the Purchaser Schedule attached thereto (the “Initial New York Life Purchasers”) and each other New York Life Affiliate (as defined therein) from time to time party thereto (the “New York Life Note Purchase Agreement” and, together with the Prudential Note Purchase Agreement, the “Agreements”), pursuant to which Stepan will issue and sell to the Initial New York Life Purchasers $50 million in aggregate principal amount of its 2.37% Senior Notes, Series 2021-B, due September 23, 2028 (the “Series 2021-B Notes” and together with the Series 2021-A Notes, the “Notes”).

 

The Series 2021-B Notes offering is expected to close September 23, 2021, subject to customary closing conditions.  

 

Stepan expects to use the net proceeds from the issuance of the Notes for general corporate purposes.

 

The Series 2021-A Notes will bear interest at a fixed rate of 2.30% with interest to be paid semi-annually. Principal amortization for the Series 2021-A Notes is contractually scheduled with equal annual payments beginning on June 10, 2024 and on each June 10 thereafter to and including June 10, 2027, with the outstanding principal balance due at maturity on June 10, 2028.

 

Once issued, the Series 2021-B Notes will bear interest at a fixed rate of 2.37% with interest to be paid semi-annually. Principal amortization for the Series 2021-B Notes is contractually scheduled with equal annual payments beginning on September 23, 2024 and on each September 23 thereafter to and including September 23, 2027, with the outstanding principal balance due at maturity on September 23, 2028.

 

The Agreements require the maintenance of certain financial ratios and covenants that are similar to Stepan’s existing long-term debt and provide for customary events of default. Generally, if an event of default occurs, subject to certain exceptions, the holders of more than 51% in aggregate principal amount of the relevant Notes outstanding under the relevant Agreement may declare all such Notes to be immediately due and payable. Stepan may at any time and from time to time prepay all or a portion of either series of Notes at 100% of the principal amount so prepaid, together with interest accrued thereon to the date of such prepayment, plus a make-whole premium. In addition, Stepan Specialty Products, LLC, a wholly-owned subsidiary of Stepan (“Stepan Specialty Products”), and Stepan Surfactants Holdings, LLC, a wholly-owned subsidiary of Stepan (“Stepan Surfactants Holdings”), entered into subsidiary guaranties (the “Subsidiary Guaranties”) whereby Stepan Specialty Products and Stepan Surfactants Holdings agreed to guarantee Stepan’s obligations under the Notes and the Agreements.

 

The foregoing summary of the terms of the Agreements and the Subsidiary Guaranties is qualified in its entirety by reference to the full text of the Agreements and the Subsidiary Guaranties, which are filed as Exhibit 10.1, Exhibit 10.2, Exhibit 10.3 and Exhibit 10.4 hereto, respectively, and incorporated herein by reference.

 

Item 2.03.

Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

 

The information set forth under Item 1.01 of this Report on Form 8-K is hereby incorporated by reference into this Item 2.03.

 

Item 8.01.

Other Events.

 

On June 14, 2021, Stepan issued a press release announcing the offering of the Notes. A copy of the press release is attached as Exhibit 99.1 hereto and incorporated herein by reference.

 

 


 

 

Item 9.01.

Financial Statements and Exhibits.

 

(d)Exhibits

 

Exhibit

Description

10.1

Note Purchase and Private Shelf Agreement dated as of June 10, 2021, by and among Stepan Company, PGIM, Inc. and the purchasers thereto

10.2

Note Purchase and Master Note Agreement dated as of June 10, 2021, by and among Stepan Company, NYL Investors LLC and the purchasers thereto

10.3

Subsidiary Guaranty dated as of June 10, 2021 by and between Stepan Specialty Products, LLC and Stepan Surfactants Holdings, LLC relating to the Note Purchase and Private Shelf Agreement dated as of June 10, 2021, by and among Stepan Company, PGIM, Inc. and the purchasers thereto

10.4

Subsidiary Guaranty dated as of June 10, 2021 by and between Stepan Specialty Products, LLC and Stepan Surfactants Holdings, LLC relating to the Note Purchase and Master Note Agreement dated as of June 10, 2021, by and among Stepan Company, NYL Investors LLC and the purchasers thereto

99.1

Press Release of Stepan Company dated June 14, 2021

104

Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

 

 

 


 

 

 

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

 

 

 

 

STEPAN COMPANY

Date: June 14, 2021  

 

 

 

 

By:

 

 

/s/ David G. Kabbes

 

 

 

 

 

 

David G. Kabbes

 

 

 

 

 

 

Vice President, General Counsel and Secretary